The supply and demand for strategic information A case study of a large medical device company

The supply and demand for strategic information A case study of a large medical device company Purpose – The purpose of this paper is to study the role of strategic information in the process of analyzing and understanding a specific company. Special emphasis is given to how forward‐looking information becomes important in relation to establishing a perception of market value by financial sell‐side analysts. Design/methodology/approach – The empirical part of the paper is based on semi‐structured interviews with financial analysts, fund managers, and the top management team from a large medical device company listed on a Scandinavian Stock Exchange. The case company is internationally renowned for its state‐of‐the‐art business reporting. Findings – It is shown how the three parties produce and consume strategic information and apply it in the process of analyzing and understanding the company and how strategic information plays markedly different roles across the groups participating in the market for information. It was specifically found that understanding the stock price and the company were two distinctly different issues. While management and the long‐term oriented sell‐side analysts' interests related to the company, fund managers and so‐called trigger‐oriented sell‐side analysts were primarily concerned with predicting the stock price. Research limitations/implications – This study motivates for a more nuanced understanding of how strategic information is applied in investment decisions, thereby extending existing research. As the case company is considered a best practice case, there are limitations to its generalizability. Practical implications – The results of this study may help companies in their quest for creating transparency around their business model and how to address the different informational needs of the capital market. Originality/value – This study provides new insights to further the understanding of how information is moved into investment decisions and thus may form the basis of further studies into this field. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Human Resource Costing & Accounting Emerald Publishing

The supply and demand for strategic information A case study of a large medical device company

Loading next page...
 
/lp/emerald-publishing/the-supply-and-demand-for-strategic-information-a-case-study-of-a-YNjZM4Ms4D
Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
1401-338X
D.O.I.
10.1108/14013381111125314
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to study the role of strategic information in the process of analyzing and understanding a specific company. Special emphasis is given to how forward‐looking information becomes important in relation to establishing a perception of market value by financial sell‐side analysts. Design/methodology/approach – The empirical part of the paper is based on semi‐structured interviews with financial analysts, fund managers, and the top management team from a large medical device company listed on a Scandinavian Stock Exchange. The case company is internationally renowned for its state‐of‐the‐art business reporting. Findings – It is shown how the three parties produce and consume strategic information and apply it in the process of analyzing and understanding the company and how strategic information plays markedly different roles across the groups participating in the market for information. It was specifically found that understanding the stock price and the company were two distinctly different issues. While management and the long‐term oriented sell‐side analysts' interests related to the company, fund managers and so‐called trigger‐oriented sell‐side analysts were primarily concerned with predicting the stock price. Research limitations/implications – This study motivates for a more nuanced understanding of how strategic information is applied in investment decisions, thereby extending existing research. As the case company is considered a best practice case, there are limitations to its generalizability. Practical implications – The results of this study may help companies in their quest for creating transparency around their business model and how to address the different informational needs of the capital market. Originality/value – This study provides new insights to further the understanding of how information is moved into investment decisions and thus may form the basis of further studies into this field.

Journal

Journal of Human Resource Costing & AccountingEmerald Publishing

Published: Apr 5, 2011

Keywords: Information strategy; Information disclosure; Supply and demand

References

  • Research and development activity and expected returns in the United Kingdom
    Al‐Horani, A.; Pope, P.F.; Stark, A.W.
  • Security analysts as frame‐makers
    Beunza, D.; Garud, R.

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create folders to
organize your research

Export folders, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off